If I'm gutting a house to the studs and fixing plumbing, electric, then new drywall, cabinets, tubs, shower, tile, flooring etc it costs me around $25 sq ft.  

There was serious electrical and plumbing issues, and there was an addition (4rd bedroom) that was never approved, not to code.

The Treasury Regulations only require that the taxpayer have the intent to hold for rental or investment or business use. 

If a deal worked out, I would plan on giving a commission to the agent because I think there's a regulation that I have to do this for 6 months after a property is listed.2.

It's hard to tell just from pictures but $65,000 in rehab seems like an awful lot for that size house, especially as a rental.The house I just did was very similar in size, needed full cosmetics, foundation, new roof, new flooring in every room plus a bunch of plumbing and gas line issues and the rehab was about 30K.

However, this will be a complete redo because the electrical and plumbing has been removed. 

I'm pretty sure that section of the code are regulations for Division of Insurance.  

And so on.You know how we end up with crazy regulations?

How old is the buildingHow old is the building's infrastructure (electric, plumbing, etc.)What is the delinquency rate of monthly rent?

Plumbing, wiring, foundation, and HVAC could be big issues you're not thinking about.